Is This Coin A Scam to help you research a cryptocurrency project.
When you are trying to learn about a project you should look at all aspects of the project.
- The current and historical financial statistics
- The state of the website
- The leadership of the project
- The experience of the development team
- The technical feasibility of the whitepaper
- The activity on the source code repository
- The sentiment of the community in social media
- The engagement from the team with members of the community
- Related news articles from media and news outlets
Is This Coin A Scam has collated all the data you need to start researching the points above.
So how can you tell if a project is a scam or likely to fail?
The simple answer is you can't. But can you learn to spot red flags and you can learn to spot good project.
Read the points below and apply the reasoning to your research.
The current financial statistics
Have a look at the current financial statistics, how much volume has been brought and sold over the last 24 hours? Are you confident that if you make any purchases that you will be able to sell it when you want to.
What does the historical data look like? Is the volume growing over time, going down or staying the same?. Do you feel comfortable with what you see?
The state of the website
What does the website look like? Is it professional and full of relevent information?
Or is it sparse, full of errors and broken links?
When a company is claiming to be running a software project involved in cryptography or smart contracts they should also be able to put together a decent proffesional website.
The leadership of the project
Leading a project towards success requires the manager to get the work done by the team members efficiently and effectively. It requires the person to have a clear vision, clarity in reason, practical in scheduling and the ability to attract a talented and efficient team.
By researching the project founders and senior management team, and you like what you see you will feel confident that the project will be looked after, conversely if your research shows you that the founders were previously involved in failed or scam projects you will know to stay away.
The experience of the development team
A good software project requires good developers. Research the team, make sure they are capable of the job. Many team profiles link through to the linkedIn pages of the person. Have a read and check out their previous experience.
Be aware though - less homest projects often use fake team profiles - to showcase developers they don't have!
The technical feasibility of the whitepaper
Reading a whitepaper can be pretty daunting. But you should still give it ago.
Anything you do not understand you can ask the project team about on their Facebook or Twitter.
Some obvious red flags would be poor grammer and spelling to indicate that not a lot of time or effort was spent to get this important document out there.
The activity on the source code repository
Almost all the software projects written on the blockchain are open source.
Sometimes there are important reasons the code has to remain closed by if it is open then the activity on the source code repo is usually a good indicator of how well development is going.
You will be able to read any open issues, see how many times code is commited to the repository each day and see how many people contribute to the project.
The sentiment of the community in social media
One of the simplest and most transparent ways projects communicate with their users is through social media.
There are so many social media platforms but we have decided to focus on three.
- Facebook - This is usually used by all levels of technical users - from the novice computer user to the experts.
- Twitter - This is usually used by medium-levels to expert levels of technical users.
- BitcoinTalk - This is the most popular cryptocurrency forum out there originally developed solely for Bitcoin but it is now the goto place for most altcoins when they make their announcements - Usually frequented by people with a good level of technical skill - but don't let that put you off from joining.
Visit the social media platforms and talk to the poeple who run the project and talk to members of the community.
Is everyone swearing and shouting each other or is everyone helpful and inclusive?
The engagement from the team with members of the community
By engaging with members of the community you can find out what people like you think.
How do they feel about the project, what has their experience been so far and what are their hopes for the project?
Related news articles from media and news outlets
It can seem kind of obvious but its easy to forget - check the news!
A simple google search can help you determine if a project is looking good in the eyes of the world or if any super suspicious has occurred in the last few days.
Research research research - education is the key to feeling confident that your chosen project is a legitimate, solid project with tonnes of potential to achieve their goals.
And remember of you find anything that is missing from the a projects page then please submit it to help the next person who reads it.